>> welcome in. joe and becky are off today. after 16 at the helm -- 16 years at the helm of the daily show john stewart is retiring. letting the news slip during last night's taping and stewart will remain on the show later this year. this follows the departure of steven colbert and will leave comedy central without a big star. it's coming up at 6:30 eastern time here on squawk. here's the other big stories today. earnings central still producing the hits. this morning we'll get pepsico, time warner aol and after the bell cisco, tesla and whole foods all to report. if global market still focussing on greece. they'll meet with other finance ministers to gattis cuss a possible bridge program. checking the futures dow would

open lower by 37 points. nasdaq lower by 2. goldman sachs holding a technology and energy conference today. yahoo! ceo and twitter ceo are expected to give keynote speeches later on today. >> in other media news nbc news announcing it is suspending brian williams for six months without pay effective immediately. he personally admitted he misrepresented events about coming under fire while flying in an helicopter during the iraq war. while on nbc news friday january 30th 2015 brian amissmisrepresented events that happened during the iraq war in 2013. then it became clear that brian had done the same while telling that story in other venues. she added this was a very hard decision.

certainly there will be those that disagree but we believe this suspension is appropriate and proportionate action. brian has jeopardized the trust millions of americans place in nbc news. his actions are inexcusable and this suspension is severe and appropriate.: appropriate. he says williams deserves a second chance and we are rooting for him. brian shared his deep remorse with me and he is committed to winning back everyone's trust. nbc news is continuing the investigation. lester holt will substitute in the immediate future. >> check out pier 1 imports. shares tumbling after reporting comparable sales growth that sell well below expectations. company also says it's cfo will be retiring effective immediately. then there's the shares or

rather the retail shares of flip side. shares of chico's surging after the wall street journal said the company was in advanced talks to be required by private equity firm sycamore. and tim cook announcing that apple will be partnering with first solar to build a solar farm in california: the planned project will produce enough energy to power 60,000 homes. shares spiking on that news. >> that brings us back to apple. apple becoming the first company ever to surpass a $700 billion market cap. the iphone maker is about 46% larger than the second biggest company in the world by market cap exxon mobil which stands at a mere $382 billion. shares have soared over 60% in the last year while the oil giant remained relatively flat.

>> thank you falling oil prices, right. >> we play these parlor games, right? and i always think the second i ever bought apple that's the day it would peak. every time i would look at it and i think the multiple's nod bad. >> we have a very close friend remember when the stock came off about a year and a half ago and went down. i had a friend that sold his stock and he said what do you think is going to happen? it's never going back. >> and here we are. >> i'm happy that i'm not buying stock. >> because you thought it was never going back. >> i told him i said it's never going back. >> didn't take that long to get back right? >> no. >> great advice. >> feel pretty good. let's talk about david tepper. spoke to me yesterday regarding the situation in greece and what

he thinks it will mean for the markets. the deal would obviously be good for the markets but i think the market could survive even if it goes the other way. i asked what he meant by survive and he said stocks could fall two or three or maybe four percent but not a big deal. the markets will be fine this year. echos what his attitude on the market has been. he's been pretty constructive. >> what does constructive mean? i hate that phrase. >> positive on the market. i think he's been positive on the market. there was a time when he was very bullish and then maybe a little bit less bullish but bullish was in the sentence more times than not. >> i think he's right on greece. i think it's going to be a big dramatic moment if they leave the euro zone and abandon the euro it will be a watershed moment for europe. >> but you don't think they are leaving the euro zone. >> well i think there's a 20 to 30% chance that it happens by accident. in theory nobody wants it to happen but the way the liquidity

situation vuning in theis running in the country, it's possible. but i'm not sure it would be crushing. they owes billions and billions and billions to european banks. they don't any more. they don't have the same control over the financial system like they did last time. >> it's been such a game of chicken taking place and you were at the white house the oo day when angela merkel and the president were holding their news conference and i thought she was very blunt and direct. do you deal with it. we gave you the deal. take it or leave it. we're not giving you anything else, bye bye. >> it's no different today than the commentary we've seen so far. greece has back pedalled. even yesterday there was more back pedaling. they're put in a corner. as long as they promise the population they're not going to leave the euro they don't have

many choices at this point. >> i didn't know how much of his -- how much it's playing here. >> i'm sure he's playing more in the context of what's going on in the u.s. >> responding to it. >> impact multinationals. >> he's always been concerned at some level as to whether the europeans were going to rise to the occasion and do what was ultimate tly necessary, that being qe. >> right. >> so i think he would tell you that that was a huge step. that made him probably more comfortable and confident where the market could go as a result of the qe by the ecb. >> let's show you what's going on in the markets this morning. the futures are suggesting a slightly negative open. but concerns about what is likely to happen today. the s&p lower by nearly 4. nasdaq lower by nearly 3. let's show you what's going on with european forces.

greece is lower by 3%. that's been incredibly volatile market. the hang seng lower as was the nikkei in japan. the recovery seems to have talled out a little bit. 55.75 for brent. the ten year yield, that's been creeping up huh? no it's back below 2% but still look to the right hand side of the chart and that's a big climb off the bottom from earlier in the year and in terms of the dollar relative to the euro right now, the dollar stronger against the euro and yen but weaker against the pound. the pound will cost you $1.52. >> better than what you had to pay for the euro six months ago. >> it was painful. gold higher by 2.5. the dow is coming off a triple

digit rally even after they're giving some pause. here is karen firestone. good to have you here. >> hi nice to be here. >> are you worried about greece at all? >> i'm not too worried about greece. i think they'll sort it out. >> when i look at the dow swroens jones over the last year i see bump and grind along the same level. we have been churning and churning. are we going to break out to the upside or down side and why? >> the way we look at the market, since july we've seen the up and down. up a percent but close down 2% and the other way around. you could have a year where we repeat this pattern over and over because there's factors weighing on the markets such as is the fed going to raise interest rates and what's happening with greece and isis and all of these major global effects so we're feeling that

perhaps the trading range is 1985 for the s&p. we're up near the top of the range. 2068 was the close yesterday. so we're feeling relatively positive but you can have the movement until there's clarity. >> do you think the feds are going to raise rates or not? >> if the fed raises rates it won't be until the end of the year. >> you're pushing it out. >> out. >> some people look at the most recent jobs report and move it in. >> that's true. the jobs report was good. the revisions were good but we haven't seen the effect really of the energy slow down. you're going to see more of an effect from halliburton for example. laying off a number of people and of course i live in boston. we have to have that new england effect keeping gdp from all of our snow. >> because everything is shutdown. >> yeah, no subways. >> so a lot of folks out there

believe when you look at the inflation numbers in the united states it's possible they don't raise at all this year and the commentary it feels like they're compelled. they're being dared by the markets markets. >> and that opportunity mean the long end is going up. >> correct. >> what you're discussing is a stock pickers market at this point. >> i hope so. that's what we like. we had a period of time where if you own the 50 largest names, 50 mega cap stocks that's all you had to own because that's what went up and that changed in the fourth quarter. so far this year it's changed and it's our preference but i would agree with that that's sy six month bet at best. >> now you have to pick stuff in the s&p and say this is going up and this isn't. >> maybe more so than in the last five years.

>> right. >> well 2011 was a year like this where if you closed your eyes the s&p and dow started at one point. but if we focus on names that have not too much exposure to currency hits. effected by energy or certain markets that are a problem, we think you have a better chance in health care and consumers to do well. >> you like the consumer story with oil prices and gas prices even though they're kicking up a little bit lately. >> it was interesting. visa said they hadn't seen a spending effect from reduction in gas prices. >> the retail sales report was weak and people were surprise because they hadn't filtered through it yet. >> people have to have money from spending less on gas. but that's an incredibly

positive number for -- >> which we haven't seen for years. kids were staying home and people weren't getting married. >> we all know people that have moved out of the house and they start to start furnishing their house and buying food and maybe they're buying a car or a new tv and that's having a positive effect. so names like costco or target a consumer conglomerate. >> good luck back in the snow. >> thank you. >> new york city looks good compared to boston. >> it's like miami beach. >> nice to have you on set. >> tesla's weak sales out of china could mean some executives heads will roll. ceo elon musk prepared to fire overseas execs after the electric auto maker sold about 120 cars in china last month. well below the targets.

shares of the auto maker are down premarket and tesla is set to report after the bell today. you can see the 2% decline. that will be closely watched to see if heads do roll and what the numbers turn out to be. >> we'll see. also in other news this morning harry wilson the architect of gm's 2009 bankruptcy seeking a seat on the auto makers board. phil joins us now with more on that story. it's getting hostile over there, bill. >> it is andrew. it's a little similar to what we saw in 2006 to 2008 when you had them wanting to have general motors move in a certain direction. the difference here when talking with harry wilson yesterday i got a sense that he's not antagonistic to the point of saying the management team at gm is crazy they're sitting on too much cash and it needs to be freed up for investors and

talking wed with harry wilson here's what he had to say. in regard to where general motors is right now and how the company is being run, general motors is undervalued and then he outlined the areas in terms of greater profit margins, et cetera. otherer's what he's looking at right now. $25.2 billion is how much the company was sitting on in cash at the end of last year. total liquidity of $27.2 billion. general motors plans to increase the dividend by 20%. that's expected to be approved by the board within the next couple of months here. harry wilson says there's been insufficient speed and clarity of milestones there's no clear metrics so investors are left saying i'm not sure what to expect. he outlined his thoughts and

plans for mary bara when they met last week. he does plan to nominate himself to join the board and will be representing four funds including three hedge funds: i asked him about the meeting between himself and mary bara. he says i think she was surprised talking about the fact that he plans to nominate himself and there's shareholder frustration. he went on to say i don't think they were aware of the level of shareholder frustration. here's the frustration wilson is talking about. take a look over the last year. this stock has been trading between 33 and $36 a share. it's over $37 a share now but that's only within the last couple of days once this proposal came out from harry wilson that he wants to join the board and free up some of this cash. it gets back to the central debate we had for years. is it a company that will sit on

a lot of cash because of the balance sheet or should it change with the times and free up the cash and not be as conservative as it has been. >> we've had harry wilson on the show many times. he was the architect to some degree of the turnover. is there anything he wishes he had done differently that would have set up the company in a different way so they wouldn't be in this place today. which is not a bad place they're in but not creating the same value originally. >> he's frustrated the board has changed. when they first composed the board you had david on the board and mr. ackerson that became ceo and they came from a private equity background and what he said to me yesterday is you need that on a board of directors. if you don't have somebody with a private equity background there's not somebody saying what

are we doing with the money we're sitting on right now? what's the plan for the future? that's a frustration of his and when they designed the restructuring of general motors it was important they put the voices on the board of directors. those voices are gone now. that's why he wants to be put on the board when the company has the annual meeting later this year. that's one of the primary things that stands out to him right now. >> about the idea that they put forforth in their statement late yesterday afternoon about wanting more information about the compensation plan and the fact that they say it does lack transparency. >> you're talking about the victim compensation plan. >> i'm going to quote from the statement here and get your reaction. in addition we highlighted the lack of transparency in gm's executive compensation program and questioned whether it properly has effective capital employment. that's sort of another level

that they want some answers on. >> yeah and there's a number of things here and this get backs to what he says to me. there's no milestones here. there's a lot of general promises whether it comes to executive compensation. whether it comes to the dividend increase. when general motors came out last week and says we're going to raise the dividend by 20% and there may be more in the second half of this year. he said to me what does that mean there may be more? what kind of a vague comment is that. set a milestone. if you hit it deliver on the promise. if you're not going to set milestones you're never delivering on the promise. >> we're going to get killed on this but is harry wilson going to be paid by the hedge funds in addition to gm if he joins us do we know? >> i don't know that. we'll get an answer on that i'm sure. we'll be hearing more from harry wilson in the next few days. >> hopefully we'll hear from him and get him on the set here and talk about it. thank you for bringing us that

story. >> isn't he being compensated by some of the profits from the gm investments by the hedge funds? >> it's unclear. i don't know how it's set up and there's been a huge at the bait about whether you can actually -- the investors can pay you separately in addition to the board. dan is doing it now. they structured it in an interesting way. the delaware courts are trying to weigh in on all of that. >> harry wilson is greek. i know nearly every greek in the city. >> in the meantime when we come back we'll talk about hack attacks and hitting high profile names. how can corporate america get ahead of the pr nightmares. or should we be happy that no real damage was done? at least not yet. this time though before we do that take a look back at this day in history.

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welcome back. a host of hack attacks in the last 24 hours. newsweek, forbes twitter to name a few. aman has the latest from washington on all the hack attacks. >> good morning. you can add delta to that list.

delta airlines the victim of an x-rated hack attack against it's facebook page and newsweek the victim yesterday of an attack apparently by supporters of isis. that spouted isis propaganda for a little while yesterday and we saw the hack against forbes saying they had been attacked in a hit that was apparently targeting viewers of the forbes.com website. all of that as the administration yesterday announced a new effort. they're calling it the cyber threat intelligence integration center to combine all the federal governments information about cyber threats into one area. a one stop shop for government officials and white house homeland security advisor yesterday said one of the big priorities will be sharing information with the private sector. >> to the private sector we made it clear that we will work together. we're not going to bottle up

intelligence. if we have information about a significant threat to a business we're going to do our upmost to share it. >> we'll see president obama in silicone valley later in the week. they're hosting a cyber security summit. all the big names will be there and we're expecting new announcements from the white house at that event so this is clear aisha high priority for the obama situation. she thinks this will be a signature issue from the 21st century in terms of security and the white house doesn't think they'll be able to stop this all any time soon guys. >> thank you for that report. we'll continue talking about this big issue. joining us with more on the latest hackings is a senior editor and we thank you for being here. >> good morning. >> >> what are we supposed to think of this stuff? if the cfo of twitter is getting

hacked that says something to me. >> i'm going to summarize what my boss wrote awhile ago. if you're going to work at twitter learn how to use twitter and a direct message. the cfo yesterday fell for something that pretty much anybody would fall for. people have fallen for clicking on a link and losing control. >> that's what he did. >> lost control of his account but this is the same guy that a few months ago was caught sending a direct message and sending it out to everybody. >> but if you're the cfo -- actually if you're anybody, i thought everyone had two factor authentication which is something where i have a password and they'll send me a code every time and they'll send it to my phone, that you're done. >> yes, that is a lot more secure. it's beyond me why twitter and facebook in particular given all the incidents haven't come to -- >> but they have it on twitter. you can do it on twitter. >> but doesn't -- he still

clicked on a link. >> yeah. >> and even with two factor authentication. >> you click on the link. >> you still would have -- >> i think you can still lose control of your account in that case. it's one of those malware akounlts akounlta accounts that takes control of the local system. >> we're no closer to stopping any of the hack attacks than we were six months ago, a year -- whatever. it seems like we have no control whatsoever over this issue. forbes newsweek twitter, someone else today, someone else tomorrow. >> sony delta anthem. in the case of twitter and facebook those are low damage accounts. nothing really happened and nobody cared because there was nothing serious going on there but if you're sending sensitive messages -- >> here's what i'm trying to to figure out. the hackers that went after, for example, twitter, they weren't

going specifically after him but he just made the mistake of clicking on the wrong thing. >> probably targeting million of people on twitter. >> newsweek different story. somebody decided they wanted that account. >> they wanted to get control of that account. >> when they hack that account they have to figure out the password. >> they do. some other means. usually malware. >> but that was a very specific attack. >> sony obviously a very specific attack. >> sony was a very specific attack. there was a zero day vulnerability involved. >> do you believe right now if a hacker was out there and they stieded decided they wanted to hack our accounts they could do it easy? it's that easy in. >> yeah. we're all potential victims

here. there's things you can do. >> but apparently that may not be enough. >> you have to make it hard for them. i secured my e-mail accounts. >> how many passwords do you have? >> too many to count. >> too many to count. you have to find a way to manage them. use something -- >> do you believe in those things? do you believe in these dash lane? >> i'm terrified if they hack dash lane they have everything. >> for the audience that's not keeping up there are systems, these are apps that effectively create passwords for you but doesn't that make you feel more vulnerable. >> it's a place to keep all of your passwords. >> it auto generates the 15 character passwords and that helps keep it straight in your head. you don't have to think that hard about it. >> but if that thing gets hacked. >> yeah, you're done. you're screwed. forget it. >> well that was uplifting.

thank you. great to have you on this morning. >> appreciate it. coming up next jornhn stewart announcing he's hanging it up at the daily show. how big a blow is this for viacom? we'll look inside the numbers after the break. and oil shock, crude prices are starting to creep higher. is the tide about to turn? but first a look at s&p 500 winner and losers. ♪ why do we do it? why do we spend every

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>> it's been the honor of my professional life. whatever reason you were tuning in for. >> that's comedian john stewart announcing he's leaving the daily show after more than 15 years. to be dipped around 2% after that announcement. it's down over 2%. this is the second major departure for comedy central. steven colbert leaving to take over the late show from david letterman. >> the valuation of comedy central drops and colbert is on to cbs. they let oliver go to hbo.

who was left? >> there were franchises and i think in terms of passionate relevance, even cross generational relevance, this is you know pretty valuable -- pretty valuable franchise real estate they lose. >> do you think it's justified? >> no, i think the client is absurd. >> you don't believe that whole network is built around john stewart cable networks are not built around single shows. they're built around single brands. that's the good news for them. the concern that i have is over time to keep the brand relevant you do need a number of franchises to be developed. particularly to that audience. so what i would say is that the

pipeline is getting thin but one show is not going to kill them. >> the show. >> even the show is not going to kill. you generally don't buy cable shows as an advertiser. what concerns me is i need to know as a stockholder of viacom i want to know if they disappear from the cable system people will go nuts and say i must have viacom back and this is one of the properties that made that difference but i don't think it's enough. >> i think a loss of 2% of the market cap of viacom was probably overdone. >> you don't think there is a large number of the population that only knew or mostly knew of comedy central as a result of john stewart? >> what i would say is i think there is a large population of the country that appointment watched. >> it's an increasingly more

fragmented cable world out there. it's hard enough to find somewhere to go. >> let me give you my surprise. viacom's networks probably control between something like 10 and 15 percent of the primetime audience. it's a big number for the networks but there is a massive amount of appointment watching. that's what they had. >> here's the question for you. who would you like to see replaced replaced. >> i barely remember it. >> look i think the key is to me i would want relevance to probably a younger generation. >> is there any -- >> so louis ck is out. >> is there anyone on the network now? >> i don't think there's anyone they would identify right now as the natural heir. >> do we say there's a

management misstep here? when i started this i said to john oliver go to hbo or let him go. colbert because he's going to cbs. >> at the end of the day the cast of correspondence, they are constantly developing talent but to develop an heir to that franchise franchise it's disappointing there's not an obvious air. >> if stewart decided he was going to retire you might have thought you would put colbert in there and things would have been okay. >> that might have solved the

problem but it's an irrelevant hypothetical. given that he left first there should have -- like what is the long-term plan to replace two invaluable franchises. suppose you were running the network. is it a management misstep? that's an immense problem that i don't think is a management misstep so much as a really good problem to tackle. >> still to come, oil shock. missed reports on the direction of crude. then the ceo of the port of long beach stops by. we'll get his take on the crippling labor dispute that could cost the economy billions and morgan stanley wealth management president shares his firm's investment advice. squawk will be right back live from midtown manhattan.

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it expects to cut 6,000 jobs around the world due to the drop in oil prices. the industry has seen many riggs pulled from the productions and projects halted. u.s. crude prices slipping once again snapping three day of gains but a new report says the collapse in oil could be almost over. still 2014 was a record year for deal making in the energy sector due to the collapse in crude and our next guest says this could be just as busy -- just as busy a year for deals. joining us is neal managing director of energy search at suntrust. so we're just going to keep seeing this sort of consolidation because of the oil match. >> a lot of the smaller companies having to go away and sure up their balance sheet but

you'll have it's cheaper to buy smaller companies than assets themselves. >> are you looking at companies with a lot of cash where they can do that and take advantage of the situation? >> sure right now it's certainly the best companies out there. the ones gaining the highest valuation. those are the best balance sheet out there. they're few and far between. the best examples are the majors. we don't cover many of those specifically. they're sitting on billions of cash. we all know that. >> are you looking at things you think they're going to acquire? >> absolutely. a lot of our others even the ones being acquired you look and they say look they don't want to take on anybody with too much debt to have to pay. they would rather pay maybe a little bit in stock. maybe a little bit in cash. so even on that side we look for some with not too much on it. >> does the probability of more m and a decrease if oil rebounds

and starts to rise meaningfully. is it all hinged on where the price of oil goes from here? >> it is to a degree. right now there's a big conference in houston tomorrow. north american product expo and everybody is going to be showing their leases et cetera but right now the problem is the spread between what people sell heing in houston think it's worth. the spread is too wide. as that comes together you'll start to see deals but if oil goes too high, you won't see them. >> where do you think it is going? there's people saying the worst may be over and then you have an ed morris from city who puts forth the belief maybe it gets a two handle. >> right now it's funny. on wednesday you see the numbers come out again today. could be right back to the 80 year high and then come friday you get the rig count numbers that continue to fall by laepeaps and bounds so you seem like you're having this tug of war on a weekly basis.

>> so i see this list of stocks that you're covering. is it because you think oil is going up and consolidation is coming or why? are you saying i'm going to sit on these because i don't know how long because i know eventually something is going to come around here. >> no, you're only buying them because at least in the medium or long-term oil and gas is going up. despite being the abundant product out there. you could have a lot of exports out there. that's exports to mexico and canada. some of my favorite names are the gas names. >> so energy for example. >> sure. >> thanks for coming in. sorry for bringing the cold here. anyway, coming up -- >> back to houston. >> back to houston you go. is this the port of no return? a months long fight between dock workers and shipping operators at risk of crippling the u.s.

economy. the ceo of the port of long beach made his way east to the cold and he'll join us next on set but first as we head to a break check out some of the most clicked on stories on cnbc.com. squawk box returns in a moment.

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welcome back to "squawk box" this morning. the west coast port slowdown is choking off the international trade for the u.s. between los angeles and long beach ports in california. two-thirds of all ocean cargo is handled there. john sunrap is the port of long beach he joins us now from the east coast with more how it's impacting operations there. and really how it's impacting the whole country. and what you think -- i've heard you say a trillion dollars. >> i've heard from a trillion to $7 trillion. >> $7 trillion. >> actually the impact to the retail sector has been very very severe. >> how quickly is this whole thing done number truth? >> well right now, we're waiting for the labor contract to allow us to dig out of epic levels. congestion. >> when you say epic levels of congestion what does that look

like for a viewer who doesn't live in the port world? >> in the port world, we have real estate moves there through the world. we are at 95% capacity. we have almost no room to physically move any more containers. >> on shore, et cetera? >> that's right. >> you are in danger of losing business to ports like the one that's not that far from the one where we're sitting? >> there's no question that we're going to lose business. the question is how bad and how fast can we recover from it. it's a diversion going on right now, growing the growth rate for the industry at a much much faster rate than we are right now. so congestion within california has caused -- throughout the entire west coast, has caused a tremendous frustration within the community for retail. >> go ahead. >> how long do you think the dispute goes on for? >> we think we're very close. it's been going on for nine months. better a very surprising

negative event for us we anticipated last fall that this would be over beyond us but it took a turn for the worse. in november. >> what was the mistake? >> the mistake with the -- >> how we got to this point. >> that's a very, very puzzle question. you know the ports like ourselves, los angeles, oakland and so forth, they're not privy or part of the negotiations. so we hear everything through second hand like everybody else. but i think it has an awful lot to do with just the concern that labor has about the automation going on in the ports and investments we're making to completely -- >> so was there a way to avoid this? i mean there was remarkable ill-will that has led to this point. >> i think the media part of it is worse than it is. i think that we will get back to normal very quickly. this is just you know negotiations and they're tough. these are two -- this is a very tough industry.

and these folks are escalating. >> do you think that some of the businesses that have for years, relied on ports to do their business will switch to air freight? some are already doing that. will it change the business models in the way it imports goods? >> and demand construction for your stuff? >> i don't think so. the fastest movement from asia to the interior of the u.s. is our ports. we're incredibly efficient. as soon as this contract is signed, we'll get quickly back to normal. but i think that really you know, there's an awful lot, talking about labor agency the problem. labor is part of the problem. but there are bigger issues that we've been dealing with. the industry is changing dramatically. >> jon, just so we know assuming that it does get signed, it will take how long to get everything back and running in the clear? >> six to eight weeks, we'll be

clear. >> thank you for coming in this morning. enjoy the east coast weather. >> thank you. >> you got lucky. it's balmy outside. still to come two hours of "squawk box" and two power players in the world of banking and finance. first morgan stanley boss greg fleming. and then the coast ceo of world trading giant deutsche bank. jan will join us with latest from everything from futures the eurozone. "squawk box" will be right back.

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earnings reports are starting to flow pepsico, aol.

cisco all on the reports today. so they don't get caught on surprise. hacking america, does this keep aol's ceo up at night, the ceo talks to us first on cnbc. they say diamonds are forever. how about diamonds made in a lab. you can tell the difference with all that shine. the second hour of swshgs swx"squawk box" begins right now. ♪ ♪ diamonds are forever they're all they need to please me ♪ live from the beating heart of business new york city this is "squawk box." first in the business world, good morning, everybody, i'm andrew ross sorkin. in for joe and becky today.

16 years at the home of the "daily show" jon stewart is retiring. comedian laying it out in last night's taping. the departure with stephen colbert. and this could put viacom down the road. rye now, viacom's shares are lower on that news. in the headlines at this hour greece is in the spotlight once again today. the country ease finance minister will offer a so-called bailout. this is an extraordinary meeting being held in brussels. it's going to start "squawk on the street." and according to "the wall street journal" the fbi is looking into how personal information was obtained about the users of the popular turbotax software program. and you can be putting yourself and your employer in jeopardy if you use dating apps on company smartphones. an ibm study showed 26 out of 41

dating apps had medium or high severity vulnerabilities. ibm has alerted the app developers of its findings. andrew, get off tinder. >> i'm not on tinder thank you. for the advice. apple passing yet another milestone, becoming the first company ever to surpass a $700 billion market cap. to put things in perspective, the iphone maker is about 46% larger than the second biggest company in the world, exxonmobil which stands at $382 million. shares of apple have soared at 60% over the last year while the oil giant remained flat. nbc news is announcing its suspending brian williams six months without pay immediately. mr. williams admitted that he misrepresented events following coming under fire in a helicopter during the iraq war.

on "nightly news" on january 30th 2014 on events that he was covering the iraq war. and this was a very hard decision. certainly, there will be those who disagree but we believe the suspension is the appropriate and proportionate action. from the statement of the nbcuniversal steve burke has said. brian has jeopardized the trust millions of americans place in nbc news. his actions are inexcusable. and this suspension is severe and appropriate but also said is williams deserves a second chance. we're rooting for him. brian has shared his deep remorse for me and is committed to winning back everyone's trust. and lester holt will substitute the "nightly news" for the immediate future. what other reports should

investors be watching for in the coming day,dom chu is here. >> 17 wrs68% of those reported have generally beat it. here's the score card through yesterday. 70% of earnings companies have beat their earnings estimate. that's a recent beat rate. caveats have been it's the low bar. 10% and then 17% have missed estimates. that's how we stand. and we're seeing a little bit more growth in earnings. we'll see if that continues as we approach this last third of earnings season. let's take a look at what's ahead. like i said about a third of companies are left to report. here are the highlights. of course, today, cisco after the bem. that's going to happen. they're generally seen as a bellwether for the overall tech business.

and also on the consumer discretionary side february 18th you've got marriott international, one of the biggest hotel chains in the world showing a sign whether people are spending money on vacations. large cap earnings season largely gets unofficially capped off as walmart reports earnings on february 19th. that's seen as an operator about the spending economy in the u.s. especially from the mid-to downside end of the speck trul. february 20th i'll throw in john deere. nothing runs like a deere. you're talking global demand for agricultural farm and equipment products. those are ones to watch. about 140 some companies left to report andrew. these are the ones you want to key in on because it will tell you something about the overall economy. back to you. in the meantime we're going to talk about banking and jpmorgan, ceo jamie dimon tolding us the big banks are under attack while others have been suffering, morgan stanley

has been thriving. the management of the firm raking in $3 billion in pre-tax earnings. and expects to hit another $50 billion in additional deposit growth in the next five years. joining us as our guest host, greg fleming from the morgan stanley president, you got to walk here for the first time. >> it's great. two blocks from my office. >> thank you for coming in. >> joe's on vacation so i win across the board here. >> that's not fair. >> hope he's watching. even if he's he'll hear about that one. >> joe is a good die. >> let's talk about jamie dimon first before where you talk about where the banks are headed. >> i think it's been incredible transition. new regulation new capital standards and every financial institution has had to adjust andrew and adjust their business model. for us we're spending most of

our efforts on execution. trying to griev forth the business mix that we have. we think we have a good set of businesses coming out of the crisis. we made a big movement to wealth management which was the strategy of my boss james foreman. we put together a set of businesses in morgan stanley that we think can thrive over the next five or ten years. >> but compliance isn't becomes just onerous and safety? >> there's no question that every big financial institution has to have observance in compliance and regulatory agencies that we're dealing with. i mean, the u.s. structure is there's lots of different regulators that you're responding to. so that's all true. but the backdrop to where we are today is improving the u.s. economy. momentum in some of our key businesses including as we talked about, as andrew referenced, wealth management, and investment banking. and the environment remains

positive. our focus moment to moment is moving business forward. but it is a different environment than five years ago but that's to be expected right? >> is goldman sachs better than morgan stanley? down at this conference in miami -- >> he can't answer that. >> well, you were at the same conference. >> he seemed to go out of his way to list all of the reasons why goldman sachs is better than their rivals. there must have been a reaction inside morgan stanley when that was written. >> here's the morgan stanley view the competitive universe now to avoid specific firms, we're very comfortable with the business mix that we have. wealth management investment management institutional securities best in class, investment bank. our trading has done a terrific job over the last five years it's become number one, number two. the connectivity between the businesses and ties with my partner tom and i, we bring the

businesses together. we took the company public. we sell our shares through the retail network, all of that. >> press one more time ultimately if you're getting a regulated like a utility, you're not going to generate the same kind of investor interest that you have in the past right? make the case that banks are better than just buying a utility? >> well, we'll make the case than some of the businesses i'm sitting here representing. the wealth management business actually has not undergone much change vis-a-vis regulators. >> but they're work on it? >> in a stones crisis. but the return on the wealth management business is similar to what it was before the crisis. and investors, with investors listening to us talk about wealth management investors are still able to provide the wealth management. the same as 2007 and 1992. >> i want to turn the conversation to client which is is this. you represent a lot of smart money, a lot of high-net

clients, they are calling you right now asking you. what are people most worried about right now? >> the biggest focus for clients and financiers where to put the money. but in this environment, it's even more pointed because you have a u.s. equity market that's performed pretty well for several years. and there are headwinds there, including the dollar for the firms that have significant percentage of revenues coming from overseas including the challenges around the world. so you look at the u.s. equity market and is it fairly priced. >> and you tell them what? >> that the u.s. economy continues to do better and therefore, there will be more volatility this year as the fed tries to pull out, both here and around the world. the u.s. economy and market still looks like a good game in town. but in a world where rates are likely to go up so fixed income is the challenge. where u.s. stock markets

generally rail and in the stock markets there's a fair amount of volatility. the top advisers are focused on what allocation are mixed and where do i put the dollars. we have earnings coming out. pepsi just out. the company earned an adjusted $1.12 for the fourth quarter. 4 cents above estimates. revenue beat forecasts. the company saying it's pleased with those results but does expect a challenging and global mac environment. the cfo will be coming up on "squawk on the street" at 9:10 a.m. eastern time. we're talking about the impact of a dollar and 4x. that's obviously having an impact on companies like pepsi even though the results are better than expected. do you expect this dollar strength story to be with us for a while? >> i do. and in a great part the u.s. economy on a relative basis is certainly one of the best economies in the world.

frankly, when you stand back and look at it there remains a lot of angst coming out of washington and the credit crisis. how have the financial institutions atdjusted. 250, 300,000 jobs a month. this economy has done very well. we're upbeat. i'm upbeat on where it's going. >> pretend i'm your client. i call up. i'm go together hand you $100 million with ten years ask morgue ton harvest this thing. where are you putting the money? >> ten years is a long time. you're going to have a lot in equities in the u.s. equity market. >> are you taking advantage of what may be a depressed market in europe right now? >> you are certainly are. i think some of our top research people including mike wilson who leading all of our capital in wealth management in europe, japan, some of the markets around the world there are opportunities. so you are going to diversify outside of the u.s. the u.s. even with the s&p 27 or whatever it is it's a significant part of your --

>> when you've got clients with that much money, you're convincing them to spend money hedging out the euro risk? >> yes. they have a much highers percentage of their money in alternatives and those types of hedging. >> greg is going to be with us for the rest of the hour. certainly is. coming up you've got earnings aol rolling out moments ago. we're talking numbers, hack attacks and a game of let's make a deal with ceo tim armstrong. then the "squawk box" exploratory committee is teaming up with governor jim gilmore and diamonds are forever. now, they're being made in a lab. but you can tell the difference? well, maybe the price. "squawk" returns in just a minute. can it track my crew's performance, and protect their heads? ♪ ♪ can it tell the flight attendant to please not wake me this time? ♪ ♪ at cognizant, we see opportunities for every company.

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profit of 92 cents. revenues below estimates which aol says is due in part to currency fluctuations. and the stock is as you can see it right there. let's ask you this greg while you're here. we haven't talked about apple and $300 billion and the lull of large numbers. is this a company that could be worth a trillion dollars? >> i think if there's a company that could be worth a trillion dollars and i've always been a skeptic about this. it's this company. it's beyond a company that's changed society. 35,000 iphones an hour they sold in the fourth quarter. half a billion iphones have been sold. now more than half a billion. we were talking on the break, michelle, it took only four years since the first introduction of the iphone in '07 for half of the american population to have an iphone. >> a-a amazing. >> it's transforming the way people act.

>> what performance of your people with iphone, is it the most wildly held? >> i don't know for sure. it's certainly a name and may be the most wildly held stock. and it's at this point probably the most highly respected company by many people across the country and around the world. >> we're going to continue the conversation on technology. we want to get to tim armstrong. he's the chairman and ceo of aol. good morning, tim, we just read your earningses aloud. before we dive into those numbers, i've got to ask you about cybersecurity. i think that's probably the biggest issue on the table this morning, given all of the attacks we just heard about this week. and what's going on in washington later this week around that tactic. is that something that's keeping you up at night. >> andrew thanks for having us on. i think cybersecurity say new reality for everyone to deal with. it's an ongoing reality that's never going to go away. we have a great security team at aol. we just convened at our internet

media companies in our offices in europe a few weeks ago to talk about it. i think from the standpoint of always having to be on guard and secure. that's just the new reality. and the best thing for any company to do is you know invest in it, pay attention to it. i think that's our plan. but it's a new reality. >> but here's the question when you hear about the cfo, for example, of twitter, his account getting hacked. when you hear about facebook getting hacked are these things that you think are on the user? meaning, it sounds like, for example, in the indication of twitter, he might have clicked on something he wasn't supposed to click on on a fish expedition. is that something on the user or on you? >> as a company your job is to keep everybody as safe as possible overall. the particulars of what happened in any of these cases is probably less important than what the companies are doing overall. knowing some of the people at twitter and these other companies and knowing anthony

well, cease are super smart, super talented people. and i think all of us are trying to do the same thing which is they really focused on how to keep users trusted and safe. and make sure it's a business that you're pivoting into a business that are important and continue to invest in. i think all of the companies in our space and frankly the offline companies, too, the new reality is you have to have the department of defense in terms of part of the structural security around your systems. >> before were hit the numbers, a very practical question. we were talking about i don't know if you mow about replast or dash. >> dash lane. >> do you use any of these passwords that controls one password do you think that's a good idea as the ceo of a major tech company? >> one thing we've done is saloued people to do that. most team up with 20 or 30

passwords. i think anything convenience-based in general is probably going to be helpful for consumers. the danger of that you have one pass word or company controlling those things. but the reality is there probably will be more pass word management, you know, available for mobile and internet. i just think that's a trend that's not going to stop. it's going to continue. >> tim, let's get to the earnings. specifically, to the extent that aol is a barometer, to the way advertising are thinking about digital. clearly, they're thinking more and more about digital. just walk us through what you think is happens as a business. >> yes. for our numbers if you take them as a barometer, there are four important things that you see in our numbers. number one is consumer continues to migrate. we're the toppest growing company in the united states for multiplatform. more consumers, more devices. second piece is our video is growing really quickly. our video grew at 90% last year.

so you see better networks better devices. the better those two things get the more video that's going to come in. third thing is really around advertising. how advertising is changing. our advertising was zero in programmatic meaning machine-helped advertising. today, it's around 40%. and it doubled, last q, it was 20%. so the last trend i think is people really need to pay close attention to is how overall technology, but also how great talent, like at our company, is helping basically cutses get better results. you our ad placing was up double digits for the entire year. and up double digits in q4. so this notion that advertising is going to get deflated over time is think is absolutely the opposite of what's going to happen. advertising is going to get more expensive. advertising is going to get more precise and more targeted. you'll see the massive shift. you're starting to see it in

tvland. consumers are going multiplatform. and dollars going to flow like water to the place where is the consumers are and it's going to get more expensive. >> tim, it's greg fleming here. glad to have you on the question of the impact on your stronger dial on your business? are you seeing it and probably going to continue to see it strengthen? what is that doing to your earnings profile? >> there's definitely an fx effect. it's hard to pick up any news or information about the business world where that hasn't affected companies. our company is we have under 20% of our revenue as international is growing, but it's under 20%. so it's probably more muted than a company that's got 50 60%, 70% of their earnings coming internationally. but i think the swing in the dollar has been really large. i think if you look at the last six months you look at the charts, it's hard to say that's not one of the mega trends that will affect people's earning. an effect on ours is probably

more muted than people have huge international businesses. >> tim quickly, the actavis starboard said that aol should combine. do you feel you're a takeover target? >> bottom line there's two things i'm not paying attention to one is the nfl because my patriots won the super bowl and i'm happy for that. the second is what's happening at other companies other than aol. you've heard, aol gets mentioned in a lot of conversations but aol gets mentioned in a lot of conversations because we've transformed the company from a lagger to a leader in the most important parts of the internet. if you look at video, programmatic advertising, like the huffington post. aol is a 100% clear leader in those businesses. and i think as the world starts to transform into the future of digital, i hope aol's going to play a really major part in that. and we're only focused on us as a business. >> tim armstrong, thank you for

joining us. next time you got to come in the studio. >> we're neighbors here. >> i know. manhattan. i'll be over next time. >> thanks. coming up rough diamond prices are skyrocketing. you can soften the sticker shock with lab-grown diamonds. they cost up to 40% less. but are they still the real thing? right after this. >> announcer: time now for today's aflac trivia question. where is the oldest stock exchange in the united states. the answer as cnbc's "squawk box" continues. has it these hills are full of 'em. it can take months for an insurance claim to surface. claimin' takes patience. aflac paid my claim in one day. they got some new-fangled kinda one day payin' machine? hehehehe yea, i got aflac at work. aflac... in just one day, we approve and pay. one day pay, only from aflac. aflac...

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>> announcer: now the answer to today's aflac trivia question. where is the oldest stock exchange in the united states? the answer -- philadelphia. it was founded in 1790. more earnings are out. let's check shares of time warner. in fact, the company reported adjusted earningses of 98 cents a fair for the fourth quarter beating estimates by five cents. revenue fell slightly. mostly because of a decline in its banner brothers movie studio business. interesting because, what they do have "american sniper" right, so -- >> which was a great, great

movie. loved. >> you're going to get a bump from that. >> for sure. still to come we take you inside the numbers of pepsi shares at this hour trading up to 7%. later, elon musk may be ready to hit the imsane button. why? because he's about to pull a donald trump and say you're fired. "squawk" will be right back.

♪ welcome back to "squawk box" this morning. among the stories front and center an emergency euro group meeting starts later this morning in brussels. finance ministers will discuss whether to offer a six-month bridging loan. the new greek government would use that time to try to negotiate a broader agreement on austerity measures. and valeant is to bide dendreon. reuters expecting to close by march. pepsi reporting earnings.

an adjusted $1.12 per share for the fourth quarter. revenue also beating forecasts. the company saying it is pleased with its results but does expect a challenging and volatile global environment this year. listen to this if you could, if i could speak, a record number of americans renounced their citizenship last year. that's according to new data from the treasury department. 314,000 americans gave up their men citizenship in 2014. that's up from the 229 announced the year bred before. among the drivers the new tax act that requires foreign banks to reveal american banks with more than $50,000. and that requires americans overseas to file tax returns. the law designed to catch tax cheats. the republican party gearing up for 2016. the list of potential candidates continues to grow by the week.

our next guest's name is being thrown in the ring. he's calling for across-the-board tax cuts and an end to the estate tax. joining us from former virginia governor jim gilmore. chairman of go-pac. >> you want to be president of the united states? >> i haven't made that decision but i want to be clear that the economy is robust and grows and more opportunities or people. i'm determined to make that case across the united states. >> are you going to differentiate yourself from other guys like jeb bush? >> you have to have tax cuts across the board. we need to have a tax reform of our corporate tax which is right now not competitive with anybody else in the united states. we need to reduce the corporate rate down to 15%. >> for corporations? >> which you can do with a comprehensive plan which i put on the table. >> what do you do for

individual? >> i think we need to reduce that by 10 15 and 25% tax brackets. >> the wealthiest 25 middle income 15? >> 15. the main point, though, to get tax cuts across the board as we saw with jfk, as we saw with ronald reagan that begins to move the economy in the right direction. now hear all this happy talk that we know right now in the united states that it isn't that robust. too many people unemployed. too many young people coming out of college with no opportunities. too many people working part-time jobbing us and they want full-time jobs. this is a national issue and must be dealt with. >> governor this is a money game, politics. jeb bush dealing with $100,000 -- tonight -- is it tonight? >> yeah, $100,000 a plate. >> per person. >> i've never seen a ticket price so high. >> how can people compete with that? >> you know, if you can buy a presidency, i guess that will do it. i believe the most important

point is to really talk be the issues that are facing the country. there are serious foreign policy issues, there are serious issues in the growth of the economy. these matters have to be addressed. if all you have to do is raise money and buy the presidency so be it. i believe that the issues must be addressed. >> is it tougher to sell the message of the economy at a time were you've got 5.7% unemployment rate. job growth 200,000 a month. longest streak in some 14 years. while not as robust as certainly most people would like do you compare this to what you're getting across the pond and other places it's not that bad? >> well compared to, say, all economies, it's not that bad. but to the realistic society that we aspire to in the united states is not good. as i laid out, you can see it's a slow growth. it's been a deliberate slow growth where you've seen the ability to write off investments. the ability to reduce. we've seen a lot of people right now out of work. we know that obamacare, for example, has made it very

difficult for part-time people to get full-time jobs. these issues must be addressed in order to get a more robust economy which will increase wage growth. i think we all agree, everybody agrees left and right that we have stagnant wages. >> we're finally starting to get a tickup in the latest jobs report. >> a little tickup is not good for me. >> if romney couldn't win on what was a far worse economy what makes a republican win this time around when the economy is getting better? >> because the people of the united states know as the ceo of gallop said last week that these big macro numbers are not actually the true picture of what's going on today. >> where do you stand on social issues because a lot of what the independent voter has been pushed to the left because of their distaste for certain party -- certain sections of the republican party being too focused on social issues? >> well, i think that everybody in the republican water or the democratic party for that

matter has an opportunity to push forward for social issues. and make those issues partnered within the campaign. >> do you have a list? >> well i don't know what it is you want to know. but the main point for me is not that michelle. the main point for me the republican party can be union ma fied behind the goings of economic growth in this country. and tax reform both at the corporate level and individual level to provide opportunity in this country. that's the main thing. and people who are on the right, left, center even the republican party can unify behind this plus a foreign policy. >> governor let me ask you a question as a follow up to that the american people as well as the business community the main concern about the budget situation some washington. deficits, they've come down because the economy is doing better. entitlement reform is going nowhere seemingly for either party. how do you feel about that or is that something you focused on if you have the opportunity? >> for sure the spending side has to be addressed. it continues to be out of hand

and driven by politics. and that is correct. the main point, though is this you have to build up the pie. you have to get greater growth more revenues not a more robust economy. it's not just the regular working people that i'm concerned about. it's also the economy. i addressed a group recently and said well you spend every dime and they said yeah we'd spend every dime. i said fine, get more dimes. >> is there a vision that the republican party has for entitlement reform and long-term structural form reform with the budget challenges in washington? >> i think it needs to be addressed. because as we know it's a state at this point between obamacare and between all the other entitlements that are ballooning up to the point where soon they'll take up everything. i think question need to address the fence. we're not spending any money on the fence, at the level that this dangerous world demands that we do. all of this you're right, on the spending side it has to be addressed. and it has to be addressed in a

thoughtful way not to say that you're going to cut people's social security. i don't think anybody wants to do that. i think we have to address the spending side. my side is the revenue side. i want to make sure we cut taxes across the board for people. put more money back in their pockets create a better economy of life and a stronger more robust economy. >> when are you going to decide if you're going to run or not? >> i don't want to get too far ahead either. i think it takes time to decide. we've got to decide this year. but what i think is appropriately is to continue to push the ideas and see if we somewhere any currency on places like cnbc and places like that. >> governor thank you for being here. >> thank you. coming up if you're struggling to find a valentine's day present, swx swgs can help. pure-grown diamonds. join us. we're going to see if you can tell the difference between a mined diamond and a grown diamond. we'll tell you what that's all about. plus, the battle between the delivery game.

a consolation brand hitting an all-time high. the pop fueled in part by continuing to strengthen its beer businesses. beer wine and spirits industry up 630% in the last five years. we're back in a moment.

welcome back to "squawk" swx this morning. yelp is taking on online take outorders. paying $134 million to buy online takeout app. it was used as a rival for running ads on porn sites. okay. it's said that a diamond is forever. but the diamond mine may not be technology. now making it possible to create lab-grown diamonds that are identical to the ones found in nature and for a lot less money. the question is, how will be would-be bribes react to the manufactured stones. lisa bristol is ceo of pure mined diamonds. good to have you is you here. >> good morning. >> let's do the tv stunt. you're wearing a real diamond or a mined diamond. the traditional diamond. and you're also wearing a lab-grown diamond on the other hand, right?

>> this is the world's largest laboratory-grown diamond. 3 carats. it's $23,000. >> put your other hand next to it. >> this is an equivalent earth-mined diamond and $40,000. >> you can take the two shots of the hands? thank you. both hands together maybe. great. >> they're indistinguishable even under a microscope. >> so a diamond expert would have no idea? i can't tell -- >> you can't tell the difference under a loop. under a microscope. and that's why every pure-grown diamond comes with a certificate from the rgi. >> is every lab-grown diamond of the same quality because it's from a lab? >> just like in nature, you have different colors an clarities. and you can choose from a whole range of diamonds according to your pocket. >> the person who is -- the person growing the diamond grow it to different specs to make the price fluctuate? >> we start the process of mother nature and then mother

nature takes over. so we get a yield just like an earth mined diamond. >> so it's this is like a two-color batch of a certain color? >> we just grow the sizes. at time on valentine's day when 6 million couples are getting engaged. this is a significant choice. >> a difference of $20,000 on the same size diamond. i would think the market share would be even higher. is there a resistance flow for the fact it's not a real diamond? >> this has been has been a breakthrough, 21st century. ecofriendly, conflict-free. and it's a responsible choice. so many conzurms want an ecofriendly diamond by this extremely -- >> at 23 grand, i'm assuming the margin is huge. do you have to price it at that level so that people think about its in the same category as they might think of as a real diamond? >> these are real diamonds. >> but a mined diamond, if you

will? >> why can't you price it even cheaper? >> yeah. >> the technology the machinery is very expensive. it's taken seven years of research and development. ge starts in 1953. our physicist is has been working on this process for over 30 years and has just made this achievement. diamonds will start to be laboratory grown many years ago. but gemological quality has never been achieved. >> technology presumably were pushed down. so will you drop the price or will you keep the price close to where the earth diamonds are? because otherwise, the consumer might think it's not quite the same quality? >> you know dealing with deletion of natural resources, mined diamonds have escalated 2,000% since 2009. and there's a complete diminished supply and the demand son the increase.

due to that in china and india -- >> if you're ever going to get the russian market. you got to produce diamonds bigger than 3 carats. that's the biggest you've got? >> that's biggest we've got. >> can go to 5 or 6? >> our scientific lab is working on it every day. >> how long did it take to grow a 3 carat diamond? >> well the pure-grown process is started in a chamber. hydrogen gas is added to the chamber. a plasma bohlig nights and six to 12 weeks later a diamond is produced that is ready for cutting and polishing like an earth-mined diamond. people think it took millions of years to produce diamonds however, it took us millions of years to find them. >> is it as durably. >> this is a diamond. four diamond. it has the same four cs and the same hardest, it's ten on the mohs scale. >> you guys did a documentary on

the diamonds. and it was an amazing moment when it happened. >> it's amazing. the friend it's conflict-free. >> does everybody want -- i mean, what's the issue in terms of selling these? i'm assuming there are some dealers who want to do business and some that don't want any? >> you know what it's education. the more people learn about lab-grown diamonds being ecofriendly, conflict-free -- >> that's it every day. >> happy valentine's day. >> happy valentine's day to you. thank you. coming up a closer look at pepsi's results out earlier this morning. we're talk be about the headwinds for this hour. an exclusive interview with deutsche bank ceo anshu jain. stick around. hey dad, who was that man? dad: he's our broker. he helps looks after all our money. kid: do you pay him? dad: of course. kid: how much? dad: i don't know

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pepsico results beating the street's expectations. nik modi on the phone. nik, pretty good quarter, yeah? >> yeah very good quarter. good across the board like you said, top and bottom line. after announced a new automation program going out. all in all pretty good. >> what's the story with obviously what a number of companies are feeling.

does it have as deep an impact on pepsico going into the quarter or no? >> yes, definitely fx up a quarter. when you think about guidance and what they've indicated for guidance for 2015 it's a little worse. at this point, we're deep into earnings season. most of that was priced into the stock. right now, it really looks like investors are looking to organic trends as indicated where stock is going to be heading in the future. >> what are you going to be looking for when it comes to the issue of russia when it comes to conference calling? did you make anything in the statement about russia today? >> you know there was a broad comment on europe. obviously, the european fx was the worst for pepsico. we'll look for on the conference call coming up in ten minutes. how the business is actually doing in terms of volume. what we've found is a lot of consumers are buying products ahead of an expected

inflationary environment. we'll see what the trends are carrying into 2015 thus far. >> the russians holding pepsi, in other words. >> 7% of revenues out of russia. it's not an insignificant number. >> no not at all. they've made an acquisition in russia a couple years ago that made the business strong in that market. >> what about margins? >> yeah margins were good. they a spur ahead of consensus to begin with. and they came in ahead of our number by ten basis points. all in all, with the commodity inflation across the snacks business and they're getting some on productivity. clearly on the front with the number. >> nik, just because you mentioned it real quick, when you think about what nelson peltz has been after, which is break up compete. when you look at the earnings and the investments they made who was right, engineering or nelson? >> well it all depends. they're both kind of -- in one

sense, i do think, and i'm a firm believer that you can make the power of one, with the beverage together i think you need to have the proper perspective across the division. that might have been for pepsico why they couldn't make it work more efficient for them over the past couple of years. breaking up the company i think would be a pretty simple solution. we've seen spinoffs as the trend and we've seen a lot of value created. so it really depends. if pepsi continues to run the business the way they're running it now, i think staying together makes sense. >> nik, thanks. >> you got it. >> a good couple of days for coca-cola and now pepsi. >> let's get back to greg fleming from wealth management. when you look at that do you think we're in for better days? >> i do. the headwinds, expected headwinds. without talking specifically

about pepsi, as he said the earnings were pretty positive. but you have to keep in mind i've heard that earnings season has been a slight disappointment in different places. but that's on the heels that american companies have been driven that over multiple years. so the economy is going to be the key. the key to that in the near-term volatility is the feld and how they continue to get out when they raise rates and the impact of that on the sentiment of the economy. i'm update on the u.s. economy and how it continues to drive the business cycle over the next few years. >> but the major cycles have nothing but turned in the last several months. >> one of the challenges on the near term, michelle is the fed. when history said when the fed's pulling in and out, it's hard for the market to churn significantly higher. i think the market is going to experience a clear amount of volatility until the clear how the fed is going to end this. it depends on the investor and

where they're sitting. i think it's a definitely across-the-board, whether it's ultra high net worth whether through a slightly more cautious attitude than 12 or 20 months ago. >> the fed move this year. >> i believe they will this year. it keeps getting discounted june, september time frame. >> wow, that's even earlier. >> greg thank you for coming in. >> great to be here. >> stop anytime you want. a big hour still yet to come on "squawk box." we're going to kick it off with deutsche bank kraef anshu jain. we're talking about the looming cybersecurity threat as well. legend has it these hills are full of 'em. it can take months for an insurance claim to surface. claimin' takes patience. aflac paid my claim in one day. they got some new-fangled kinda one day payin' machine? hehehehe yea, i got aflac at work. aflac...

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we're kicking off this hour with a rare interview. the co-ceo of deutsche bank join us exclusively to sound off on bank regulation and the possibility of a fed-fueled catastrophe. siesh threat. high-profile and knick and the cfo of twitter got spammed. the stocks you should be watches as companies bolter their defenses. and incredible moment for greece. the new government abandoning

austerity. and now they must decide how to respond. the latest on the showdown in brussels today as the third hour of "squawk box" begins right now. >> announcer: live from the most powerful city in the world, new york. this is "squawk box." welcome back to "squawk box" right here on cnbc. first in business world, i'm andrew ross sorkin along with michelle and scott today. joe and becky are off. joe was playing a little golf at pebble beach. take a look at u.s. open futures at this hour. not looking so great. dow opened 52 points lower. nasdaq off by 4 points. s&p 500 off 5 points. among the top stories at this hour president obama seeking additional force with the use against isis. it will reportedly include limits on u.s. combat troops

involvement. but allow the use of special forces and advisers. the fbi now involved in investigating the filing of fraudulent tax returns in 19 states. that's according to "the wall street journal." the fbi looking into how personal information was obtained about the users of the popular turbotax software problem. and shares of chico. sales popping on the women's retailer sycamore partners. the deal will reportedly be worth $3 billion or more. if completed it will be the largest buyout of the year. nbc news is announces it is suspended brian williams for six months without pay effective immediately. mr. williams personally admitted he had misrepresented events coming under fire while flying in a chinook helicopter in the iraq war. and in a statement, while on "nightly news" on friday

january 30th 2015 brian misrepresented events which occurred while he was covering the iraq war. it was wrong and completely inappropriate of someone of brian's position. she then added this was a hard decision. certainly there will be those who disagree but we believe the suspension is the appropriate and proportionate action. steve burke said, brian has jeopardized the trust that millions of americans place in nbc news. his actionseses inexcusable. burke also said that williams deserves a second chance and we're rooting for him. brian has shared his deep remorse and committed to winning back everyone's trust. lester holt will substitute and anchor "nightly news" for the immediate future. stocks this morning, andrew. pepsico beating estimates on both the top and bottom line. even as the battles for negative impact. the beverage and snack giant

does say it's expecting a, quote, challenging environment for 2015. and the time warner estimates above estimates on the bottom line. seeing shortfall on revenue results at its warner brothers studio where a particular drag on revenue. now, andrew. >> i was so excited. we have a huge morning of financial heavy hitters on stocks. the next guest runs one of the largest banks with more than $1.1 trillion in assets. he's been vocal on the adverse effects joining us exclusively in a rare interview. i don't think we've had you on the program before anshu jain is here. good morning. >> good to be here. congratulations on your new locations. >> actually, we're close by. neighbors now. i think of you as a guru on all things europe. given where deutsche bank sits and lots of issues including angela merkel. i'm hoping you can give us a

sense whereof this whole debate with greece is going to be? >> that's unfortunate, i say that because greece was definitely heading in the right direction. you take a look at the journey greece has been on since it began its austerity program. structural reform has been reduced. a lot good things were. happening. obviously a price had been paid. and now we've got it moving in a different direction which creates a level of teng between them which has been funded. >> what do you think the chances that a deal gets done. they meet today, they fear the plan. there's another meeting on monday. historically, the ceo of deutsche bank regardless of who it is has a close relationship with leader germany regardless of who it is. based on conversations you have. not super privy here can't say for sure what do you think the chances are for a deal? >> nobody wants greece to exit

the eurozone. the sanctity of the eurozone is very important. undoubtedly, for the leaders of greece now pits them into -- >> if you're trading bottom -- how are the positions, let's ask it that way? >> can't talk about trading positions, obviously. but the odds that we get some sort of a short-term deal are reasonably good. the long-term outlook is troubling. >> what do you think could happen if greece did exit the eurozone? how messy could it get. >> i'll put this in three seg mngtss. first time around we were talking about this the you're please greece held were heavily held and a lot with other european banks so the possibility of contagium is much higher than today. today it's down to 20%, last i checked. the concern really would be a domestic concern for greece itself. because if you start getting

deposit flight which we've been seeing, as much as 10 billion uros out of the greek banking system within last month. that continues amid the social unrest and so on does become quite real. but i would definitely say that global contagium worries are now in my fears. >> agree with the assessment of a david tepper who told us yesterday that he doesn't think that a greek exit would be such a dramatically negative impact for the market that it may have a blip of you know 2, 3, 4%. that the market is fine? the market is better able to handle the news today? >> we're still thinking about 20% of that being held in private sector hands. we're talking about the implications of that for the rest of europe. so this is no small thing but i would agree the worry that we would have had a few years ago, one of the very high wealth to

private ownership. but secondly, we didn't have the programs that we had, so yes, one can take comfort from the fact that real institutions have been built and real progress has been made over the last couple years. >> i want to take the conversation to banking. we were in dallas together a few weeks ago. the financial times reported that you had, quote, clash with jack lew and mark harmon over regulation. and jamie dimon said that banks are under assault. he tamed that back in davos on our air. do you think banks are under assault? >> it was a conversation that often happens between industry leaders and top regulators. and certainly, in my opinion, i think a lot of the regulatory change which has come is badly needed. the impact of 2008 is one which we cannot easily forget. and certainly, i would not be of

the view that regulation is not required. a lot of it is. >> but the implications of the regulation from what i understand you guys were debating was you thought it created problems with liquidity in the market? >> there are a number of concerns not just mine but other concerns as well. that 2015 is a likely fed changer. this is when we do get a change in the vision that we've enjoyed for the last multiple years. and if tested dealer provided liquidity could well be -- >> play that out for us. i hear this from market participants all the time. liquidity impairment. that means you can't get a trade done. you're trying to get out, you're trying to get in and there's nobody there to make a market four. pull that out for us. what happens? are we talking a crisis the dow goes what -- i hear it a lot. i'm not quite sure what it means

to the average person. >> first and foremost the argument is a little self-serving so i have to concede that. >> sure. >> dealers telling you that harsh regulation -- >> no buyers are telling me this. >> okay. that's a little more neutral. the way to pay out is modest -- let's first of all distinguish. >> over the counter. >> exchange markets with otc markets. a lot of markets are dependent on large dealers providing short and immediate-term liquidity. in the end, it's the buyers of assets that step up. dealers provide the interim shock absorption. and the concern would be that over the course of the last three or four years, liquidity leverage and capital rules and dutch franc for that matter do constrain how it it from four or five years ago.

>> the question has been asked about regulation of where deutsche sort of sits today. jamie dimon thinks that banks are under assault. deutsche has had some of its own issues obviously, over the past few years. you would leak stories that would mention ghosts of the past. catching up with deutsche some from acquisition, some from the investment bank at the time when you were there. are the ghosts now exercised from deutsche? or is this still an ongoing issue for you? >> we've made enormous progress in the last 2 1/2 years. capital ratio has doubled. we've taken the leverage ratio from the high 1s to 3.4. we've spent a lot of money on recap forming, on compliance, on internal regulation and so on and so forth. most importantly, we've had a program for change which we initiated 2 1/2 years ago. society bank's made enormous progress but i certainly wouldn't say we're about to declare victory anytime soon.

this is a fundamental transition. which we always said was going to take time. >> you're one of the few banks that still wants to try to do it all. there are a lot of other banks started shutting assets because there's a lot more capital required for certain things. why have you chosen to stay with that path? and isn't it more expensive because you have to retain more capital? how do you stay competitive? >> we've got a balance sheet by almost 30% over that same period of time. so the fact is we're not oblivious that you have to get leaner in terms like these. i think clients have manifestly demonstrated that they need a multiple of different business modes. and there really are a whole different types of financial institutions. you've god the shadow banks of hedge funds and you got the globals focused on one business and management. you've got the superregionals or regionals which are currently the favorites. to an extent and yes, there's no doubt about the fact that

post-crisis being large multiproduct multijurisdictional has been very expensive. and stock markets have impositioned a real discount on that business model. why keep it? because clients want it. and in the end, we get a waxing and waning of short-term trends but you want to stay with the model which is required by the system. and i'm convinced in offline status that there is room for more than one bank. and there's very few that are not american that fit that character. >> that's true. how long will the markets reward you for that? >> that's a key question. did zbl did you read the goldman sachs report though, on the breakup idea of jpmorgan and what that would mean? did that make sense to you in a model perspective? >> i'm broadly aware of the items put forward. look, the whole conglomeration an argument that's been made many, many times.

the question you have to ask yourself, would each individual unit be asked not just multiple. that's easy. and have a lower capital threshold which is easy as well. the main tenets of that piece, the question is will they be successful? the answer is yes. we have to look at it. >> let me ask you quickly, everybody, most people anyway feel like the u.s. is the alpha performer, best place to be. does some of that optimism, does it make you nervous, where the united states is relative to the rest of the world? >> consensus views are always worry. there's one consensus view that you're going to get, the stability and robustness of the character. it's based on so many factors. if we were sitting here four years ago, we would be having a different conversation. we happen to believe that the u.s. recovery is real. they have threats.

we're confident it's real. and hence our view on the fed. >> you just had a big trip to india. what do you think he's doing? how is he doing and how quickly are the things he's talked about going to come true? >> we've taken some leaders. and india is under performance for a very long time. i was there the other day, the president is leading a senior delegation. there are a number of countries that believe that the bank is going a different direction. yes, i believe he's sincere about changing the fundamental model. >> a lot of people believe he's insincere insincere sincere, but there are people who question can he get it done? >> undoubtedly, 1.2 billion population. the challenges there are well-known. and the potential is so

dramatic, and even if incrementally, he can make progress. >> we're going back to what we started with greece. >> much more expertise and other people to comment with more intelligence, what i will say, the word is very concerned. without being too dramatic. stability that we've had, both here and europe could be threatened. i'm very pleased to see the chancellor and the u.s. president take this as seriously as they are. so we've got the world's best minds focused on this. but the problem is still significant. >> do you have a view on what we've been seeing in energy and oil markets? >> the most fundamental change we've seen markets, the bella, the surge in the bella and the drop in oil are the two big moves. look, if it stays, it's going to create winners and losers no doubt about that.

1.9 trillion moving from users to consumers. and i believe this is a jump in gdp. that's very significant. do oil prices stabilize. that's a hard point to make. the deutsche bank believes it will drop back to 60. that's still a healthy place to be. >> before we leave you go we've been asking every ceo, we're talking about cybersecurity. >> what's your worst nightmare, do you actually worry about waking up in the morning and like zero in the accounts? >> i worry about that. i do. >> let me ensure everyone that is watching that we are putting an incredible amount of effort into making sure there is no identity theft and there are no significant breaches. but we've doubled the amount of money we spend on protecting ourselves against it. we have a malware lab in

germany, we're taking the threat very seriously. >> anshu, thank you for coming in. >> good to see you. coming up apple earning the distinction of the largest ever market cap. topping $700 billion. a closer look for what's next for the company after the break. later, hackers taking on major companies. we're going to talk hacker support with a white hacker. we'll explain that means coming up. ll sounds good. it's not muted. was that you jason? it was geoffrey! it was jason. it could've been brenda.

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all right. we're watching apple's stock this morning. shares of the tech giant all right up 10% so far this year. trading at all-time highs going back to its ipo in 19 account. dom chu joining us. >> it's worth an 7$711 billion. apple shares up 10%. up 60% over the last year. this is a stock that's been a true juggernaut. even going back over its ipo back to the early '80s.

if you look at this picture, there's also something driving the growth. over the last five years, the compound growth rate how much it's grown per year over the last five years. it's grown sales by 38%. what company wouldn't want to have have a sales growth of 38.8% per year. its profits grow 47% per year. its assets grow 34% per year. that's the reason why this company is worth $704 billion. the insiders the big owners of the stocks yes, are the ones who benefit. the biggest owner of apple shares is vanguard. they've got 327 million shares. then state street global advisers, think of those spider etfs. tim cook all have big stakes. overall, scott, guys a huge company making a lot of people very wealthy.

>> we should also note apple up 30% since the stocks split last june. so does apple have room to run or is the stock going too rich here? here on the set to break it down is dave garrity, principal at gva research. how long until the trading market -- >> exactly. hundreds of millions of dollars as people look at them. the thing to consider we've got fairly important dynamics taking place near term. which is mainly a week from tomorrow, we got the chinese new year. and we got in the fourth quarter, obviously, 1.2 billion people giving high-end gifts. apple iphone 6 is an important item there. again for the first calendar quarter, apple is number one in china. they are looking at longer term expectations as this upsieblgle will may take apple from the 15% share up to 33% by 2018. >> that's in the world or china?

>> that's in the world. you're basically looking at a double in share which would give you a compound growth rate better than what people are looking for on the street. >> that's just products and nothing? >> just on the iphone 6. >> that's a perfect comment to make. i was going to say what are the risks. it's almost as if you ask a question about apple, you kind of chuckle, you can't think of any. what are the risks? >> the risks, china has basically declared war. anybody who is a nonchinese provider, we saw the fines levied against qualcomm for their chips there. you know would china suddenly decide to shoot itself in the foot from a manufacturing standpoint to basically declare war on apple? i mean that obviously would serve to cap growth. that's a political risk. >> and where is that ranked? >> personally i'd put it somewhere around a 4. i think china wants to show that they're a source of high-end

manufactured products for the rest of the world. >> and any chance some other technology company, google or otherwise has some kind of massive technological leap that we haven't considered in this happiness. >> the thing is google's play was to basically provide free software android. and just power all the other devices that are out there. even though they've done very well, they haven't provided the integrated experience that people like around the apple user experience. that's not to say never. there's nothing that comes up immediately. >> would you add to it today? would you add to apple today? >> yes. because the other thing to look at here the company went out and borrowed money very cheaply, $1.5 million in switzerland. and a basis point are for a ten-year maturity. they've got in april, a $130 billion buyback program, that would be raised 150 to $200 billion. apple is scooping up cheap cash. >> tim cook said as much

yesterday. if we can return more cash to shareholders, we are going to. we'll make that decision in april. not that many blocks from here carl icahn said that's great, what's wrong with making a decision in february. >> well look carl has a trillion-dollar number as sort of his own objective to where apple ought to be valued. obviously, everything is moving in that direction from that standpoint. >> thank you for coming in. "squawk box" returns in just a minute. david steiner. and redpoint ventures jeffrey jang. "squawk box" tees off at 6:00 a.m. eastern time from pebble beach. right who are on cnbc. profit from it.

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♪ coming up on the manager says toyota should be in your portfolio. david harrow joins us. and philip gets insane in a

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♪ welcome back to "squawk

box." let's take a look at a handful of stocks that are gaining in premarket training. generac gained in shares. drugstore chain rite aid is buying envision pharmaceutical for $2 billion. it's owned by tvi. mosaic earns 92 cents for share in strong demands for phosphates and pot ash. scott. the dow making its way up above 18,000 after global fears may have spooked investors. joining us it david harrow. he manages the oakmark international fund. david, welcome. >> good morning. what makes the best sense for you in the kind of market that we're in right now, volatility

ic picking up once again? >> well volatility is viewed as our friend. it's moved quite aggressively. and of course our belief as value investors is that the fundamental intrinsic values don't move anywhere where near the price. that gives us volatility. especially in negative headlines like we see in europe a lot of global companies could value blue chip in particular as well as others that look attractive. >> such as what? >> some of the financial sector companies like pnb paribas. they had a hickup having to pay that big fine here in the united states. other than that excellent operators, very good on cost good retail operation.

also extremely low value yags. why? because the euros fears continue to feed on the european equities. >> that becomes a central question though next the discussion we're having and in other ones about the market. where do the best values lie? are they here in the united states or are they in europe? the european markets outperform ours to start this year. has that changed the way you're thinking about the stocks you're picking even as you like europe? >> well, the stocks have bounced a little bit. we generally see good value around the globe, even in the united states. you do have to be selective. but what has been extremely hit over the last couple of years, besides the european financials that i mentioned, some of these consumer product companies, european-based entities that are exposed to the global consumer. the luxury gootds companies, some auto companies. really, very low valuations.

they're not just exposed to europe. they're exposed to the globe. they offer very good value. companies like richmont bmw, these are good businesses that are exposed to the growing global consumer. that might be a little weak for cyclical reasons but structurally, is this where you really want to be exposed. >> tell me quickly about toyota before you go why you like it? >> toyota has done a wonderful job in the last year three or four years transforming itself to an efficient, high-quality business. it used to be a typical japanese company. large board, too big of a cash pile position. not really aggressively looking to increase profitability and margins. and all of these things have reversed. they've trimmed their board size. they made it more international. they continue to take costs out of the business. they are the most efficient car producer in the world. they have a good footprint of the emerging market footprint

and a very good valuation. especially with the weak yen. and this is probably one of the best japanese investments you can look at to take advantage of that weak yen. and it's a high-quality business. >> david, we'll make that the last board. thank you for coming on. we appreciate it so far. david herro. oakmark investment. and joining from us vancouver washington this morning. >> hi guys, i'm at tom lariman's farm. here's the deal. they got too much pot here. it's an unbelievable situation. he doesn't know that he'll be able to hang around to get the seeds in the ground. washington is different. the tax is really high. medical marijuana isn't taxed at all. why would people want to switch

over. and he's saying that washington isn't getting the famed out-of-state tourists like colorado is because there's already so much pot in oregon and california. >> in the earlier days we were able to get $17 to $22 a pound. >> wholesale? >> yeah whole said sale. it's like $700 $800 a pound? >> is that still profitable? >> no. that's 45,000 extra pounds floating around out there with no home right now. we thought by december we would recoup all of our profits and losses. we'd be able to get back current under our payments and save our farm and even do some modifications. well that didn't happen this year with the huge influx of cannabis that came in throughout the state. so right now, we're facing bankruptcy, and our farm is up for foreclosure. >> well one other difference between washington and colorado in washington you can grow

legal pot outdoors. and they have great weather in the eastern part of the state leading to a bumper crop. growers here say that unless they lower the tax for recreational pot so it can be competitive and profitable or they make the medical pot system go away a lot of these operations in washington will go up in smoke. guys. >> thank you jane. appreciate it. >> wow, when you legalize something, right, just in general, the price comes down. >> they make it regulatory -- >> no the margin disappears when something goes from being illegal to legal. >> and then you can tax it? >> like out of business as they're doing this poor guy. coming up we're talking about salvage companies-twitter accounts chipotle and twitter accounts hacked. david kennedy the ceo of trust s.e.c. sect.

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$29.95 or less. welcome back to "squawk box." after a strong performance last year the technology sector is one of the worst performers so far in 2015 but that's where investors see big opportunities. morgan bentley joins us more

with. >> cyberand security. anthem just last week. and with the federal government that just unveiled a new agency and companies spending more on this type of defense, analysts are very bullish on this group. considered a potential m & a target. turns small profits. sales have been soaring. analysts call for a 8% gain on fortinet. and another one, checkpoint. ten 10 upside. carries no debt. recently boosted its share buyback program. also acimim we take a look at that stock in premarket trading up 4%. almost 5% on that report. there's others as well palo alto networks which has been a favorite despite it's lofty valuation.

cyberark. and later today, we'll get more fireeye and cisco. given the fact this is a mega-tech company. has its hands in so many businesses. represents a diversified business. back to you, andrew. >> okay. the massive cyberattack and is your home the next hacking front? president obama in his state of the union promised to get tougher on illegal hacking. and this friday the ceo of trusted trustedsec. glad to have you. >> thanks for having me. >> people talked about an internet 2.0 some other layer that livesncrypted world. is that even a possibility?

>> it's possible to make things more secure. to say something is unhackable. no we don't have the ability to make things perfect at this point in time. >> when we think about more and more things that just means that our house and homes are even more hackable? >> that's what's happening right now, we're getting your integrated in our houses. a thermostat system in our house. the cam, and all of this technology, and they connect to the internet. and they've been driven out. there's a "60 minutes" article that came out about hacking smart cars. a new samsung too v withv with private cy. >> you can hack somebody's brakes? >> you can kill somebody like that. there was a few years ago,

somebody was able to walk past the implantable device a pacemaker and caused it to send bursts of electricity to kill a patient. it's getting out of control at this point. >> you're scaring the heck out of me. what's the answer? listening to you you would think we shouldn't have a nes. we should buy bay used car from ten years ago. don't put anything in the cloud and forget about the pacemaker at this point. >> well, there's a lot of positives. happening. there's a movement called the cavalry movement which is trying to focus on security within public safety. and there's a lot of folks that have gone behind that to get to the manufacturers of cars to get to what we call the internet of things on iot. to protect them ahead of time. there's a lot of things being done. the problem is we're a few years behind. they rushed these things out the door without security. we still have a few more years of being cautious of. >> are you calling ging them the

cavalry? like cavalry? >> the group is called i am cavalry. to get them to the security of devices to be secured. >> what is a white hot hacker? >> a white hot hacker is good. >> a good guy versus a bad guy? >> right, companies against the bad hacker. >> dave if you were a bad guy, can i ask you this could you hack my e-mail if i wanted to? >> absolutely, no question about it. right here just by knowing your name i can pull your social security number, home address. all the other stuff. i can pull your e-mail accounts. i can listen to your voice mails. >> you can listen to my voice mails? >> absolutely. >> just tell us so i know. i'm serious. this is selfish. but for the audience trying to understand. i have a gmail account, can you hack that today? >> absolutely. all i have to do is spoof your phone number. call your phone number making it look like it's coming from yours. a lot make it seem like you're

dialing in to yourself. you can listen to people's voice mails. a very common technique that's been around for years. >> i wish you hadn't told the audience about that. >> you asked. >> how about e-mail? >> when you forgot my password. the challenge questions are usually something i can find out about you that are super simple. they're not very challenging. >> and i'm happily, or at least double authenticated, can you beat me now? >> double authentication is a very good thing. you can enable this on your social media accounts. i highly recommend it. it's not impervious but makes it definitely harder to break into. >> david, thank you for joining us and scaring us. we appreciate it. >> thanks. appreciate it. >> we don't need those skills anymore, right? >> some might -- something that you don't want the rest of the world to hear.

>> speak for yourself. coming up jim cramer is getting fired up for the trading day. we're going to head had downtown to the new york stock exchange. and as we head to break take a look at shares of starbucks hitting an all-time high as the company's plan for global growth continues to gain momentum. ♪

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down to the new york stock exchange. jim cramer birthday boy yesterday, joins now, jim, great to see you. >> great show this morning. listening to what you guys -- the last fellow hacking everybody, that was negative. very negative piece, man. >> we don't disagree. >> crime school of the air. >> personal stuff there, not related to business that doesn't read well. >> yeah. pepsi, wanted your views. >> it's funny if i were pepsi i would have played up the fact gross margins were great. they left off the bullet. i wonder whether the soda wars aren't done. i see no pressure in terms of the battle of coca-cola. this better quarter than coke come coca-cola, we're not so bad, no longer as terrible. this is a solid quarter from

pepsico. impressive. >> but greece on the risk meter map for us i suppose, of what you're thinking about today, as they try to get a deal. >> you know i think that greece is going to extend terms. i think 70-80-year agreement that will work for everybody, space saving. does greece have to leave? it's 11 million people. scott, it can't keep controlling narrative of europe. you can stretch out payments and figure out within those payments a place to exit from greece. >> cfo of pepsi coming up. what are you going to ask him? >> yeah hugh johnson's coming on. positive story to tell. the reason i like pepsico so much unlike nelson peltz, the combination worked this quarter, soda and snacks. a lot of great ideas. i wonder if he gets in there if johnson gets in there from heinz

and doesn't find that he kind of likes it you know? heinz guy likes it. >> jim, i have harry wilson gm question for you. >> yeah. >> how do you feel about activists going to take board seats and then get paid by not only the board members themselves, but the investors. >> i don't like it. the reason i didn't like it for dow chemicals, i want people to be completely aligned with common stock shareholders, the whole common stock shareholders not just the guys that hut putt them on. andrew go back to your piece yesterday. mary barra's doing a great job. ignition on the front page of the new york sometimesen ss don't see a lot of stuff about the ignition. a big dividend boost above 40. they -- she's doing a great job. attack coleman, doing a great job. attack berra the best thing, i don't think they're alive with this they can sell. to me now they're in they're

not going to flip it. i like that so many bad executives. it's coincidental, maybe more than that? great piece yesterday. follow up on that piece, it was great. >> appreciate it. maybe we will. see you in just a few minutes, look forward to following up with that. coming up can tesla warm up to buyers in cold weather states? phil lebeau will tell us what the company plans to do get buyers in northern states and hit the insane button and see what happens. back to this moment. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.

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most tesla sales take place in warm weather states no wonder the company's looking to ramp up sales in cold weather northern states. but will buyers warm up to the idea of a rear wheel drive car in the snow? cnbc's phil lebeau is in chicago, the windy city with more. phil? >> hey, andrew here's the key. this is not a rear-wheel drive model-s. the performance version of the model-s. the p 85-d dual motors rear wheel, front wheel, not only allows for greater performance, especially those who like a

sports car but better performance in the snow better traction, even with 19-inch tires on the vehicle here. yesterday we had a chance when we went up to wisconsin to see how the p-85-d handled drive in snow. to be honest it did fantastic. in fact we had no problems at all. probably some of the best driving as far as sedan goes that i've ever seen in a car. so when we're in this vehicle yesterday, the question came up how does tesla do in cold weather states? the company does not break down its sales specifically by states or regions but i've asked around in the industry and the general feeling is probably a quarter to a third of their sales here in the u.s. come in cold weather states. they're targeting growth beyond california, which clearly is the largest market for tess ta. the p85d all about expanding sales. tesla's reporting fourth quarter and full-year earnings after the bell today. two numbers to focus on what's go on in china in terms of

deliveries in the fourth quarter, we know there was a drop, and what were the full-year deliveries. number to focus on 33,000. that was the guidance from company during the last conference call at the third quarter. if it's below 31,000 you might have problems there. guys, we're following this all day long giving you some better peek as the p85d. if you excuse me i'm going to test out insane mode. >> insaidne mode. >> like luke skywalker. >> presses the button. hyperspeed. >> let's watch this. >> this is -- >> he's got -- >> 0 to 60 in 3.2 seconds. >> our show's over in 3 seconds. gotta go. >> let's watch. >> tell us when. one-thousand one, one-thousand two, one-thousand three. >> pretty fast. thanks for joining us. thanks guys for being here

today. "squawk on the street" begins right now. ♪ good wednesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber. stock market cautious as european leaders take on some big issues the future of greece and effort to end hostilities in ukraine ukraine. plenty of earnings to work w